Bangladesh’s inflation rate climbed to a ten-month high in February, rising to 9.13% from 8.58% in January, according to the latest data released by the Bangladesh Bureau of Statistics (BBS).
The increase marks the fourth consecutive monthly rise in inflation since it reached a 39-month low of 8.17% in October last year. Economists attribute the spike mainly to higher food prices ahead of Ramadan, election-related spending, and supply disruptions.
Food prices drive inflation
Food inflation recorded the sharpest increase, jumping to 9.30% in February from 8.29% in January. Non-food inflation also edged higher to 9.01%, reflecting continued pressure in sectors such as housing, transportation and healthcare.
Bangladesh has been experiencing persistent inflationary pressure for more than three years, with low-income households bearing the greatest burden as they spend a large portion of their income on food.
Demand and supply factors
Economists say multiple factors contributed to the February spike. Zahid Hussain, former lead economist at the World Bank’s Dhaka office, noted that election-related campaign spending and increased food consumption during political gatherings added to demand pressures.
He also pointed to supply-side challenges, including port disruptions in February and seasonal gaps in food production between the winter harvest and the upcoming spring harvest.
In addition, miscellaneous expenses within the consumer price basket also recorded notable increases, contributing further to overall inflation.
Monetary policy remains tight
To combat rising prices, the Bangladesh Bank has maintained a tight monetary policy stance, keeping the policy rate at 10% for nearly one and a half years.
Economists believe this contractionary approach has helped prevent inflation from rising even higher. Ashikur Rahman of the Policy Research Institute of Bangladesh said the 12-month moving average suggests inflation is gradually trending downward, indicating that the current policy stance is beginning to show results.
However, analysts warn that global uncertainties, including tensions involving Iran, Israel and the United States, could increase fuel and import costs, adding further pressure on the economy.
Economists cautioned that any premature easing of monetary policy could reignite inflationary pressures and threaten macroeconomic stability in the coming months.
